Saturday, February 13, 2010

Trade long and prosper

Tired of the trend model blogs? Me too, but it was necessary to bring everyone up to speed on this methodology, to serve as a background for navigating the debacle that is emerging in the charts, albeit at this early stage of the suck-them-in-it-won't-go-down criminal manipulation.

Below some Weekly charts of a basket of ETF's that will serve well in the coming financial debacle. But only for a time. At some point, you will need to cash out of these instruments and get your money into some non-paper-statement form. Yes, it will be that bad. But until further notice, these will be fine, safe and profitable vehicles.

There is only a slither of a chance I am early here, if so, the Trend Models will let us know soon enough. If not, its time to get involved heavily on the downside of the market. Notwithstanding the SPX Hourly flip to LONG on the close Friday, I expect hard down next week. We are in take-all-Sells mode until further notice. If you are on top the markets all day long, you can play these short-term Buys, but we wary, it wreaks of deception and manipulation.

FXP

EDZ

SRS

FAZ

TZA

DZZ

ERY

My expectations are for these all to triple by my birthday later this year. After that, they accelerate up in a parabolic fashion.

If you are a subscriber to my private email list, I have some special fun reserved for you. So excuse my placing this particular basket up for all, it will pale in comparison to what we will be doing with the Trend Models already being followed and the ones that will be added in the next few weeks. Diversification will be the direction and fine tuning will be our focus. By the time this market debacle is in full and unmistakable force, we will be thoroughly entrenched in some very exciting and lucrative positions.

As for the skeptical, "What if Allan is wrong" contingent, that is the wrong question to be asking. We are trading in sync with some very astute longer-term Trend Models which by their very definition and creation are the markets. They are our navigators through the markets this year, so it is not what Allan thinks, it is what the markets are doing and they are showing their hands in our charts, every day, every week, every month. All we have to do is go along for the ride.

9 comments:

The beauty of trend following, is that you follow the trend. You don't anticipate a trend. As they say, the trend is your friend. It seems to me, that you are anticipating some trends, which may, or may not, occur.

God knows I'm not exactly a Boy Scout, but the motto fits, "Be Prepared." That is the theme of today's post, which I suspect you understand as well as anyone.

Anticipating trends is fine, as long as you don't act until the trend is on the same side as your action. On the charts above, some are already in the anticipated trend, so action is appropriate. This mixed bag won't last for long and all of the above will be in sync, soon enough.

"...don't act until the trend is on the same side as your action." FWIW, some Long Wave analysts believe that we will follow the path of the "Winter" period of 1873-1896 rather than that of 1929-1933. If that turns out to be the case, the stock market correction won't be as severe. Above all, it is important to heed your wise advice of not acting until the trend is in place.Stan

Now learn this lesson from the fig tree: As soon as its twigs get tender and its leaves come out, you know that summer is near. Even so, when you see all these things, you know that it is near, right at the door. ... For in the days before the flood, people were eating and drinking, marrying and giving in marriage, up to the day Noah entered the ark; and they knew nothing about what would happen until the flood came and destroyed them.

~ important one does not get pusillanimous while on the brink of great success--in order to keep in with those that refuse to prepare and profit. Instead, be like Noah and sail irregardless. Sever ties (incl. with preconceptions). Trade! Lynyrd Skynyrd - 'Am I Losing'

"At some point, you will need to cash out of these instruments and get your money into some non-paper-statement form. Yes, it will be that bad." Allan

Was wondering if you could elaborate on your comment as to what you would consider appropriate non-paper-statement forms of money and what the timing of this conversion may entail? eg, how do you envision one will know that things have deteriorated so badly that it is indeed time to get out of all paper assets?

The mantra here is to find something that works, then trade it. That something is Trend Following using a proprietary version of an Average True Range trend line. You can see it embedded on all of the charts that I post. It’s a simple observational system, if prices are above the trend line then prices are in an uptrend and if prices are below the trend line, prices are in a down trend.

For some, the most challenging part is actually trading the system. That’s where I come in with my observations and analysis. The “music” is my feel for the markets, as I have been doing this for a long time, from my first 5 shares of General Motors circa the mid-1960’s, to my reading of The Elliott Wave Principle in 1982 and through my acquisition of Advanced GET in 1994, the year I gave up my law practice and moved to the beach to trade full time. I have never looked back.

My tools are simple, but powerful. This is the best of the lot and I make it available for a nominal monthly fee. Subscribers not only get my proprietary Trend Following Model, but they get me; access to me for questions and/or learning through private email exchanges. We have found something that works. Now we trade it.

Profile

Originally from Detroit, Michigan, I attended Mumford H.S. the University of Michigan (BA), Suffolk Law School in Boston (JD) and Emory Law in Atlanta (LLM-Taxation ). Thus, with way too much formal education, I opened up my own law practice in Atlanta and closed it down 15 years later, whereupon I moved to the beach, Kiawah Island SC, to trade for a living. I made a fortune in the great bull market of the nineties, than lost 80% of it back in the great bear market of 2000-2002.

The stock market crisis of 2007-2008 led me down yet another path, this time through the discovery of simple trend following algorithms. Not long after reading Trend Following by Michael Covel, a reader sent me a link to an article in TASC that in turn led me to an algorithm that turned all that I had ever learned about trading on its head. The outcome is represented in my proprietary Trend Following Trading Models and the evolution of how and why is documented posts starting in late 2009.

As for the personal stuff, the music, the poetry and the joys and angst of living the good life, well, my spirit tells it all in the words, images and ideas that come together through the aegis that is, AllAlan.blogspot.com

A note about the AllanTrends web site: Most commercial sites have pop-up windows appear when you click on them. The idea is to capture your email and begin a never-ending email campaign to sell you their product or service. The worse ones collect emails and sell them to email lists marketing companies.

THERE IS NO SUCH POP-UP WINDOW ON MY SITE. ANYONE CAN EXPLORE THE SITE FREELY AND ANONYMOUSLY. I EVEN MAINTAIN A FREE PUBLIC CHARTS SECTION THAT IS UPDATED EVERY WEEKEND WITH CURRENT CHARTS OF SPECIAL INTEREST.